Measurement Standards in Office Leasing - BOMA - Allen Matkins University

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How to Measure Commercial Square Footage

Three Parts:

Calculating the square footage of commercial space is a complicated process that requires relentless attention to detail. Renters must consider an array of factors when deciding whether to enter a lease arrangement, including overall square footage of the building and regional standards. Tenants who fail to grasp important concepts are sometimes surprised by hidden costs and useable spaces that are smaller than they had envisioned.


Choosing a Measurement Method

  1. Compare measurement techniques.Landlords may use several different measurement techniques to assess the square footage of a space. These methods include:
    • Useable square footage, or USF: This is the space the tenant actually occupies. Rental agents often quote this figure to prospective renters, but it represents only part of the lease arrangement.
    • Rentable square footage, or RSF: This is the combination of the useable square footage and a percentage of the common-area square footage of the building. Common areas, which are parts of a building all tenants benefit from, include the lobby, elevators, hallways and stairwells.
    • Gross square footage, or GSF: The entire rentable square footage of a building.
  2. Decide what method of calculating commercial space is best for you.The Building Owners and Managers Association (BOMA) simplified industry standards for measuring rentable space in commercial buildings in 2010. The BOMA's 2 leading methods are Method B and Legacy Method A.
    • Method B: The new Single Load Factor Method calculates the rentable space for each tenant using a uniform approach in measuring floor area. It is the same for all floor levels of a building.
    • Legacy Method A: The 1996 standard uses separate unit prices for the USF and common square footage. In some cases, it may be beneficial for tenants to opt for this approach.
  3. Choose a measurement method based on the property type.Typically, the measurement technique used will depend on the intended usage of the property and the planned number of tenants. Office buildings, shopping centers, and other multi-tenant buildings will typically be measured using RSF. Single-tenant buildings like warehouses or production facilities are measured using GSF. However, landlords may not be required to use a specific method to measure a space.
  4. Consider regional leasing standards.Federal law allows landlords to measure rentable space using any method they desire. However, certain parts of the country may have different rules for calculating square footage. Two notable examples are:
    • The Real Estate Board of New York (REBNY) allows building owners to maximize profits by letting them bring RSF as close as possible to GSF.
    • Tropical areas: New rules account for enclosed and open areas of commercial buildings in areas normally affected by specific weather conditions.

Measuring Commercial Square Footage

  1. Take nothing for granted.Measure the useable space yourself. A miscalculation in determining square footage can cost you thousands of dollars over the duration of the lease. Typical measurement standards allow for a 2 percent error tolerance when measuring commercial space. However, this can translate to a lot of money, especially in large or expensive spaces. Make sure to measure the area as carefully as possible, especially if you are the tenant that might be negatively affected by these miscalculations.
  2. Measure simple square footage.To measure commercial square footage for a rectangular space, multiply the length of the room in feet by its width. For example, a room that is 12 feet long by 12 feet wide is 144 square feet. For L-shaped or divided spaces, you can measure rectangles of space independently and then sum the areas to get a total area measurement.
    • Measurements may be taken using a tape measure or laser measuring device.
  3. Account for unusual shapes.Take care when measuring irregularly-shaped sections of a room. To conduct your measurement, try splitting the room into shapes with easy-to-calculate areas, such as rectangles and triangles. The area of a right triangle can be found by multiplying the lengths of the two non-diagonal sides (those two joined by the right angle) and then dividing the product by 2.
    • For example, if there is a room with a diagonal wall running through it, you must use a more-complicated formula to determine the area's square footage. If the length of the space with the diagonal wall was 10 feet and its width was 8 feet, the square footage of the area would be 40 feet.
    • That is because the wall cuts the total square footage, which would have been 80 if the room had no wall intersecting it, in half.
  4. Measure common areas.Common areas should be measured so that rentable square feet can be calculated. Common area square footage is measured using the same methods as usable square footage unless otherwise provided for in local laws. Common areas might include elevators, bathrooms, lobbies, stairwells, and hallways. Importantly, common areas must be available to all tenants to use or benefit from. Make sure to measure the total square footage of all common areas in the building.
  5. Finding gross square footage.Gross square footage measures the total area of the space, including the thickness of exterior walls. To measure this area, you will need to measure wall length from the outside of the building and use those dimensions to calculate square footage. GSF is not reduced for obstructions such as ventilation shafts, support beams, or elevator shafts. GSF does not include open areas such as parking lots, pools, or unexcavated basement areas.

Using Square Footage Information

  1. Calculate load factor for the building.The load factor represents the additional percentage of square footage added to usable square footage to calculate rentable square footage. To calculate load factor, start by finding the total usable and rentable square footages of the building in questions. Remember that the usable square footage is the area that can be rented to tenants and the rentable square footage is that area plus common areas. Then, divide RSF by USF to get the load factor.
    • For example, if a building has 80,000 square feet of usable space and an additional 20,000 square feet of common areas, the rentable square footage would be 100,000.
    • Then, the load factor would be calculated as 100,000 / 80,000 = 1.25.
  2. Finding rentable square footage for a property.The rentable square footage for a property can be calculated using the building's load factor and USF of the property. The load factor is multiplied by the USF to get the RSF. You can then use the RSF and price per square foot to figure out the monthly rent.
    • Continuing with the previous example, imagine that the property is divided in half between two commercial spaces. So, each one has 40,000 square feet of usable space.
    • To find RSF, multiply this amount by the load factor, which is 1.25. This means that the RSF in this case would be 40,000 x 1.25 = 50,000.
  3. Weigh the differences in commercial properties.Unit prices can vary widely based on the location and class of the building. The rent on a 500 square foot (46.5 square m) office downtown might run higher than the rent on a 1,000 square foot space (92.9 square m) only 10 blocks away. Buildings fall into 1 of 3 standard classifications.
    • Class A: These are the most prestigious buildings in the most-exclusive sections of a city. Class A buildings command higher rents than average.
    • Class B: This is the broadest classification. Most of these buildings have fair to good finishes.
    • Class C: Units in this class are highly functional but offer few amenities. Rents are generally low.
  4. Calculate total rent for a property based on square footage.Rents are typically based on a space's RSF or GSF. Once you have this data, you can use the market price per square foot to determine a rent price for the property. Continuing with the example above, if rent were .50 per square foot of RSF per month, the rent would be .50 x 50,000 = ,000.

Community Q&A

  • Question
    Is square footage rounded to the nearest foot?

    Real Estate Broker
    Carla Toebe is a Real Estate Broker in Washington. She founded the real estate agency CT Realty LLC in 2013.
    Real Estate Broker
    Expert Answer
    You can round up each measurement to the closest half foot or foot. For example, if measuring a rectangle, round up the length to the nearest foot or half foot, then multiply that by the width, rounded up to the nearest foot or half foot.
  • Question
    How do you determine the square footage of a commercial space with five angled walls?
    wikiHow Contributor
    Community Answer
    Try dividing the space into rectangles and triangles and then measuring them independently. Then, add up those areas to get your total square footage.
  • Question
    What if I know the square footage but not the length?
    wikiHow Contributor
    Community Answer
    Divide the width into the square footage to get the length (Square Footage/Width = Length).
  • Question
    Are walls included in rentable square feet?
    wikiHow Contributor
    Community Answer
  • Question
    How can I calculate rent if my property is worth a foot?
    wikiHow Contributor
    Community Answer
    It's the square footage x = the annual rent. You'd have to divide that by 12 to get the monthly rent.
  • Question
    How do I measure residential real estate square footage?
    wikiHow Contributor
    Community Answer
    If you've measured your area in meters, convert it first to feet. When you finish the conversion, get the square footage of the area by using this equation: (Length x Width = Area). For example, if you have a room of 20 ft. length and 15 ft. width, 20 ft. x 15 ft. = the area. 20 ft. x 15 ft. = 300 sq. ft.
  • Question
    Is square footage rounded to the nearest foot?
    wikiHow Contributor
    Community Answer
    When measuring in square feet (imperial units), it is common practice to round final calculations to the whole square foot. In a typical leasing agreement, a fraction of a square foot is typically not considered worth negotiating over.
Unanswered Questions
  • Can rentable square footage be used as a selling point when selling a commercial property?
  • How do I calculate square footage if the building has a 2nd story?
  • Should I calculate the thickness of exterior walls in calculations of square footage?
  • How do I calculate rent?
  • How do I calculate a price per square foot?
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  • Many commercial leases have common area expenses added into the cost of the rental separately. When comparing the cost per square foot to rent, be sure to find out if the common area is included in that calculation, or if you are being charged separately, as it can be a hidden monthly fee.

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Date: 02.12.2018, 03:33 / Views: 53335